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FUNDING OF UPp/n RENEWAL AND
NETGHSORHOCD DEVSLOFMENT PROGRAM
PROJECTS
APRIL 29, 1969
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The City of Atlanta is presently engaged in eight Urban Renewal Projects
and five Neighborhood Development Program Projects (3 in execution, 2 in
planning only). These projects are funded jointly by the City and the
Federal Government. The funding were calls for a contribution
equal to one-third of the Net Project costs from the City with the re-
maining two-thirds being supplied by the Federal Government.
The City's share may be in the form of cash contributions or non-cash
grants-in-aid, these grants-in-aid are demolition and removal work,
project or site improvements, public and supporting facilities, and others
such as credits from construction of public housings. At present, the
eight Urban Renewal projects presently in execution are summarized as
follows:
Net Project Costs $60 million!
Local Non-Cash Grants-In-Aid 20 million
Local Cash and Real Estate
Credits 1 million
This points very emphatically to the fact that our present Urban Renewal
program has been financed almost completely through the use of non-cash
grants-in-aid, The results of this policy can be seen in the long delays
encountered in the closing out of these projects, some of which date back
into the 1950's.
The cash used for these projects has come from money set aside in the 1957
and 1963 General Obligation Bond Issues and totaling $3.2 million. There-
fore, we have, at present, $2.1 million of unencumbered funds available
from this source, Of this amount, $1.7 is presently expected to be needed
lof this amount $4.5 million or 74% has been incurred as interest charges.
to meet the cash requirements of the Bedford=Pine Neighborhood Development
Program Project in 1970.
The non-cash contributions of $20 million are the eligible portion of
total expenditures totaling about $29 million and have some of the
following forms.
School $11.4 million
Section 1072 & Special Credits 1.3 million
Streets 4.7 million
Parks «7 million
Water Improvement e6 million
Sewer Improvements 06 million
Special Facilities e3 million
Traffic Improvements . el million
Other e3 million
—— es
$20.0 million
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Some of the problems encountered because of the use of non-cash contribu-
tions (94.8% of total city funding) as the City's source of funding Urban
Renewal activities are:
1. Butler Street
A. Middle School with a total estimated cost of $2 million has
been delaying the close of this project, but should be under
contract by August of 1969.
2. Rawson ~ Washington 7
A. tetenboehood Facilities, Building with a total estimated cost
of $1 million of which $150,000 will be an eligible project
cost. This project is at present unfunded with the only
possible source of funds being through Model Cities. It is
presently plannedfor the City to purchase the land from the
Housing Authority and hold this until a determination is made
rss Beers eee Bia Sha aanenteinedan AF PANTS Paws dries
resarding the use of Model Cities funds,
B. Park with an estimated cost of $240,000 of which $33,000
will be eligible costs, No source of funding is presently
ascertainable,
3. Rockdale
A. Elementary School with an estimated cost of $1.5 million and
expected to be under contract by August of 1969.
B. An expansion of the existing elementary school with an esti-
mated cost of $700,000 and at present unfunded.
C. Park with an estimated cost of $75,000 which is also presently
unfunded,
4. Thomasville
A. Elementary school with $1.5 million estimated cost and ex-
pected to be under contract by August, 1969,
B. Park with estimated cost of $126,000 which is at present
unfunded,
C. Two primary schools with $1 million estimated total cost and
a middle school with an estimated cost of $2 million are un-=
funded and no source is seen until at least June of 1971,
The advent of the Neighborhood Development Program has brought to an end
the period during which the City could pledge an improvement and then
wait until funding became available before completing it. Under the texms
of an NDP agreement, the City must have completed or have under contract
all non-cash grants-in-aid pledged for that gariewlan Te contribute
the required amount in cash,
23.
Our present NDP projects were funded for 1969 from already existing improve~
ments or supporting facilities amounting to a total City committment of
$10.8 million. This supports a total Neighborhood Development Program of
$32.4 million.
The 1970 program is expected to have the following City requirements;
: Cash Non-Cash
Bedford-Pine $1.7 million $ .2 million
Model Gities 1.5 million 1.3 million
Edgewood el millica «2 million
Vine City el million «2 million
$3.4 million $1.9 million
Be ere ee ote
This would support a total program of $19.9 million and would increase
greatly if the Edgewood and Vine City projects were expanded to a signi-
ficaht level of activity.
This means that to support the fairly light level of activity projected for
1970, the City will need approximately $1.7 million. If any new areas are
added or the level of activity increased this would increase from $2.5 to
$4.0 million for 1970,
The possible sources of funds include;
1. General Funds - This »urce is already under considerable pressure and
no relief is presently anticipated.
2. The G O. Bonds already approved. for issue in the amount of $4 million
annually. The financing of Neighborhood heveliomment Programs fm these
bonds would require the use of almost this entire amouht every year and
could very likely become embroiled in legal tangles,
3. Another possibility is a special Neighborhood Development Program
General Obligation Bond Issue of $10 - $20 million in 1970 with another
issue 4 or 5 years later or the obtaining of voter approval to issue
G. 0. Bonds for this purpose in the amount of $3-5 million per year.
This approach is naturally subject to the whims of the public, and, there-
fore, of uncertain dependability.
4, Perhaps the best method would be thxough the obtaining of a new rvevenve
source, by state approval, such as a sales tax or a payroll] tax of which a
certain portion would be earmarked for Neighborhool Development Programs,
Of course in the pursuit of a new source of revenue we are at loggerheads
with the state and may not be able to obtain a satisfactory revenue source.
Regardless of the method you favor in obtaining the needed funds, it is
imperative, if the City of Atlanta is to maintain its progressive image and
to continue its dramatic development, that a source be found; because the
continuation of a significant program of restoration and rehablitation of
the central core of Atlanta is a vital element in the continued evolution
of our City.